Marketing Budget Calculator for Contractors
Stop guessing what to spend on ads. Work backwards from your target ROI, average ticket, and close rate to find the maximum you can pay per lead, per customer, and per month.
💰 Your Business Numbers
Your average job numbers. Use real averages, not your best job.
🎯 Target ROI
How much return do you want for every dollar spent on marketing?
📊 Your Funnel Metrics
Your actual marketing funnel metrics. Use the defaults as starting benchmarks if you do not know yours yet.
Your Funnel: Impressions to Jobs
Your Marketing Numbers
$0
monthly ad spend to hit your job goal
Adjust the inputs on the left to see your marketing numbers update in real time.
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How to Set Your Contractor Marketing Budget
Most contractors set their marketing budget by picking a number that feels comfortable. That is backwards. Your budget should be a math problem, not a feeling.
This calculator works backwards from what matters: your profit per job, your target ROI, and your actual funnel conversion rates. The result is a ceiling. A number you cannot exceed without losing money. Everything below that ceiling is a smart investment.
The Reverse-Engineering Approach
Traditional marketing budgets start with a percentage of revenue (the common advice is 5 to 10%). That ignores the most important variable: whether your funnel actually converts. A contractor spending 8% of revenue on Google Ads with a 2% landing page conversion rate is burning money. A contractor spending 12% with an 8% conversion rate is printing it.
Understanding Your Funnel
Every dollar you spend on ads travels through a funnel before it becomes revenue. Impressions become clicks. Clicks become leads. Leads become appointments. Appointments become jobs. At each step, you lose people. The conversion rate at each step determines whether your marketing is profitable or wasteful.
The most common leak is the landing page. Contractors send expensive clicks ($8 to $15 each) to pages that convert at 2 to 3%. Fixing that single number has a bigger impact than any other change you can make.
LTV Changes Everything
Most contractors calculate ROI on a single job. That understates the real value of marketing. An HVAC customer who comes back for annual maintenance and eventually buys a system replacement is worth $7,500+ over their lifetime, not just the $250 tune-up that got them in the door. When you factor in lifetime value, your allowable cost per acquisition goes up dramatically, and strategies that looked unprofitable on a per-job basis become highly profitable.
Benchmarks That Actually Matter
- Average Google Ads CPC for home services: $8 to $15
- Average cost per lead (non-branded search): $149
- Average cost per lead (Performance Max): $72
- Average booking rate: 37 to 55% depending on campaign type
- Average close rate on estimates: 30 to 50%
- Minimum LTV:CAC ratio for sustainability: 3:1
Frequently Asked Questions
How much should a contractor spend on marketing?
Most contractors should spend 5 to 10% of revenue on marketing. Under $1M in revenue, expect $1,500 to $3,000 per month. At $2M+, plan for $3,500 to $7,500 per month. But the percentage matters less than the math: calculate your maximum cost per acquisition first, then work backwards to a budget that stays under that ceiling. If your CPA ceiling is $200 and you need 30 jobs per month, your maximum budget is $6,000.
What is a good cost per lead for HVAC contractors?
The average cost per lead for HVAC Google Ads is $104 as of 2026, based on data from 816 contractors. Non-branded search averages $149 per lead, branded search $34, and Performance Max $72. But cost per lead alone is misleading. A $150 lead with a 45% book rate costs $333 per booked appointment. A $100 lead with a 25% book rate costs $400. Focus on cost per acquisition, not just cost per lead.
What is LTV:CAC ratio and why does it matter?
LTV:CAC is lifetime value divided by customer acquisition cost. It measures whether your marketing is sustainable. Below 3:1 means you are spending too much to acquire customers. Between 3:1 and 5:1 is healthy. Above 5:1 means you can afford to scale aggressively. For a contractor with a $2,500 average ticket, 3 lifetime jobs, and 25% margins, the LTV is $1,875. If your CAC is $400, your ratio is 4.7:1.
What is a good landing page conversion rate for contractors?
Average landing page conversion rates for home service contractors range from 3% to 8%. Top performers hit 10% to 15%. Below 3% signals a problem with your offer, messaging, or page speed. Before increasing ad spend, fix your conversion rate. Improving from 3% to 6% cuts your cost per lead in half without spending an extra dollar on ads.
How do I calculate cost per acquisition for my contracting business?
Divide your total marketing spend by the number of paying customers it produced. Include ad spend plus agency fees. For a more detailed view, track each funnel step: cost per click, cost per lead (CPC divided by landing page conversion rate), cost per booked appointment (CPL divided by booking rate), and cost per acquisition (cost per booked appointment divided by close rate). This shows you exactly where money is being wasted.
What is the difference between marketing ROI and ROAS?
ROAS (return on ad spend) measures revenue generated per dollar of ad spend. A 5:1 ROAS means $5 in revenue for every $1 in ads. Marketing ROI measures profit generated relative to total marketing investment. A campaign with 5:1 ROAS but 25% margins has a real ROI of 1.25:1 on profit. Always calculate ROI on profit, not revenue, to avoid overestimating returns.
Knowing Your Numbers Is Step One
This calculator shows you one piece. The Growth Report shows you the full picture: where you're leaking revenue, what to fix first, and how contractors like you are growing past the ceiling.